FEYE, GIMO and SIMO moved to ‘Hold’; stop loss prices raised
Six months ago we identified FireEye (NSDQ: FEYE) as “The One Tech Stock to Own in 2015“, and since then its share price has done nothing but go almost straight up. On that day it closed at $28.56, and ended last week at $51.03 for a gain of 78% in only six months! As much as we love this company, we think its share price has gotten a bit frothy so we are bumping up its stop loss price to $41 and holding off on accumulating more shares until its financial performance catches up with its share price.
Likewise, we are thrilled with the 55% gain we have experienced in Gigamon (NYSE: GIMO) since adding it to our portfolio on March 16th of this year, so we are moving its stop loss price up to $29. And we love the 105% profit in Silicon Motion Technology Corp. (NSDQ: SIMO) since its addition to the portfolio in April of last year, but it too is now fully valued and has been moved to a hold with a revised stop loss price of $29.
Please do not misinterpret our actions; we still like all three of these companies very much, but sometimes the price of certain tech stocks can get a bit ahead of their value, at which time it is only prudent to raise your stop loss prices and let them breathe for a while. We are very much looking forward to the day that we can resume our active buy recommendations for these three companies, but at current prices we feel they are fully valued.
Likewise, we are thrilled with the 55% gain we have experienced in Gigamon (NYSE: GIMO) since adding it to our portfolio on March 16th of this year, so we are moving its stop loss price up to $29. And we love the 105% profit in Silicon Motion Technology Corp. (NSDQ: SIMO) since its addition to the portfolio in April of last year, but it too is now fully valued and has been moved to a hold with a revised stop loss price of $29.
Please do not misinterpret our actions; we still like all three of these companies very much, but sometimes the price of certain tech stocks can get a bit ahead of their value, at which time it is only prudent to raise your stop loss prices and let them breathe for a while. We are very much looking forward to the day that we can resume our active buy recommendations for these three companies, but at current prices we feel they are fully valued.
Stock Talk
Wes
Jim,
If you believe FEYE and GIMO are fully valued why not sell now at current prices to lock in the hefty profits?
Jim Pearce
Wes,
Good question. We only sell a stock if we feel it fully valued from a long term perspective. With these three companies we still like their long term potential, so we are hanging on to them until their earnings catch up with their valuations, which may take 2 – 3 quarters. But that is also why we include stop loss prices in our portfolios, as that can ensure that you protect most of your gain in case we are wrong and a stock turns out to be overvalued and suffers a major decline.
Jim
You must be logged in to post to Stock Talk OR create an account
You must be logged in to post to Stock Talk OR create an account
Add New Comments
You must be logged in to post to Stock Talk OR create an account